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Facebook buys WhatsApp for whopping $19 billion
Posted By Ashraf On February 19, 2014 @ 5:50 PM In Android,BlackBerry,General Tech,iOS,Windows Phone,World Wide Web | No Comments
Last week Japanese internet giant Ratuken bought Viber — a popular messaging app for mobile devices — for $900 million. Today Facebook has blown away that transaction out of the way by purchasing WhatsApp for the tiny sum of $19 billion.
WhatsApp, a five-year-old pioneer messaging app that charges a small $0.99 yearly fee for the ability to send free messages to your friends and family using your internet connection, is said to have 450 million active users and is adding one million new users per day. According to Mark Zuckerberg, “No one in the history of the world has done anything like that.”
And no one in the history of the world has bought an app for $19 billion either. Until now.
Assuming regulators don’t squash the deal, Facebook will be paying the owners of WhatsApp $4 billion in cash and $12 billion in Facebook stock, while WhatsApp employees will be eligible for $3 billion worth of Facebook shares if they remain employed at Facebook for at least four years.
Facebook says they will not close WhatsApp and will run it as an independent app/company, similar to what they have done with Instagram. However, we see some convergence between the two down the road despite what Facebook claims right now.
If I may provide some commentary, was Facebook really wise in paying a huge $19 billion for WhatsApp? I mean, yeah, they are the largest messaging app for mobile devices and they are growing like mad. But, really, $19 billion? Ratuken got Viber and its 300 million users for $900 million — almost 1/20th the amount Facebook paid. We don’t know the rate Viber was (is) growing at but are WhatsApp’s extra 150 million users really worth $18.1 billion more? Especially when you consider
Don’t get me wrong, WhatsApp is a great app and company to buy. But $19 billion? I’d say WhatsApp just made out like a bandit. If I were a Facebook investor, I’d be pretty angry right now.
[via CNNMoney ]
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 CNNMoney: http://money.cnn.com/2014/02/19/technology/social/facebook-whatsapp/
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